Property

One of the main challenges facing Vietnam’s real estate sector is that many businesses depend on credit while there have been regulations introduced recently to tighten credit to the sector. According to Mr. Nguyen Manh Khoi, Deputy Director of the Housing and Real Estate Market Management Department at the Ministry of Construction (MoC), when capital access is tightened, real estate is affected. Under a proposal from the MoC, the government will submit amendments to the Land Law, the Law on Housing, and the Law on Real Estate Business to the National Assembly, to open up development.

“Land fever” has spread all around Vietnam over the past three years. Faced with the risk of a real estate bubble forming and possibly bursting at any time, management agencies are trying to identify solutions to cool and re-regulate the market in order to make it a driving force of economic development.

The Dong Nai Provincial People’s Council has issued a decision to cancel 12 residential projects in Long Thanh district that were included on a list of land acquisitions but not implemented for three years. Most of the projects are in the southern province’s Long Thanh town and Long An, Long Phuoc, Phuoc Binh, and Tam An communes on a total area of some 220 hectares.

The Minister of Finance has issued Official Letter No. 3849 to People’s Committees in centrally-run cities and also provinces on the prevention of tax losses in business activities and transfer activities in real estate. The Ministry of Finance is now reviewing legal documents relating to real estate for possible amendments and supplements, to ensure consistency with other legal documents.

According to the General Department of Vietnam Customs, total tax collections by the customs sector reached more than VND135.3 trillion ($5.9 billion) in the first four months of this year, representing 38.45 per cent of the annual estimate. To promote digital transformation, the customs sector is boosting the reform of administrative procedures, increasing the application of information technology, and enhancing its competitiveness.

Despite being viewed as an attractive area in Vietnam’s real estate market and posting average growth of 25-30 per cent a year, real estate along the northern coast still faces many barriers to fulfilling its potential. According to analysts, suitable policies are needed to help the area develop.